LOAN GRANTING AND ITS RECOVERY PROBLEMS ON COMMERCIAL BANKS (A CASE STUDY OF FIRST BANK PLC, OJO- ALABA BRANCH)

ABSTRACT
This research work was undertaken to assess the Loan granting and its recovery problems on Commercial Banks. The research was intended to achieve the following objectives: To find out the several problems facing loan recovery, the effects of loan default on commercial banks and the measures that will be used in reducing the incidence of loan default. Relevant data were collected from both primary and secondary sources. Questionnaires were the main primary data collection instrument employed while data from various relevant publication constituted the sources of secondary data. Upon the analysis of data, the following conclusions were drawn: That problem of loan default stemmed from the fact that there is unavailability of security to be disposed by banks to realize funds. And also customer’s attitude towards loan payment. On the basis of the above findings, it was recommended that commercial banks should use some risk control measures to guide against loan default. Also, before granting loan, they should examine critically the project statement submitted by the customer or borrower which will help them to find out the realistic repayment pattern and also help them in knowing if the projects are realistic based on the customer’s past performance. Also, the Central Bank of Nigeria should create a conducive environment for the successfully operation of commercial banks in Nigeria.

TABLE OF CONTENTS Title page--------------------------------------------------------------------------------ii
Approval page--------------------------------------------------------------------------iii Certification----------------------------------------------------------------------------iv Dedication-------------------------------------------------------------------------------v Acknowledgment-----------------------------------------------------------------------vi
Table of contents-------------------------------------------------------------------vii-ix Abstract----------------------------------------------------------------------------------x
CHAPTER ONE
1.1 Background of the study---------------------------------------------------------------1
1.2 Statement of problems-----------------------------------------------------------------3
1.3 Objectives of the study-----------------------------------------------------------------4
1.4 Research question----------------------------------------------------------------------4
1.5 Research hypothesis--------------------------------------------------------------------5
1.6 Scope of the study---------------------------------------------------------------------- 5

1.7 Significance of the Study -------------------------------------------------------------6
1.8 Definition of terms----------------------------------------------------------------------6
1.9 Limitations of the study----------------------------------------------------------------7
CHAPTER TWO LITERATURE REVIEW 2.1 Brief introduction--------------------- 8
2.2 The nature of loan and advances granted by banks-----------------------------9
2.3 Problems of loan default-------------------------------------------------------------13
2.4 Causes of loan default---------------------------------------------------------------14
2.5 Effects of loan default----------------------------------------------------------------19

CHAPTER THREE RESEARCH METHODOLOGY
3.1 Research design--------------------------------------------------------------------- 21
3.2 Definition Population --------------------------------------------------------------21
3.3 Sample size--------------------------------------------------------------------------21
3.4 Sources and method of data collection------------------------------------------22
3.5 Method of data presentation and analysis--------------------------------------26

CHAPTER FOUR
4.0 Data presentation and analysis---------------------------------------------------23
4.1 Presentation and interpretation of data------------------------------------------23
4.2 Data analysis and findings--------------------------------------------------------31
4.3 Discussion of the findings---------------------------------------------------------32
4.4 Recovery measures------------------------------------------------------------------33
CHAPTER FIVE SUMMARY OF FINDINGS, RECOMMENDATIONS AND CONCLUSION
5.1 Summary of findings---------------------------------------------------------------- 39
5.2 Recommendation---------------------------------------------------------------------40
5.3 Conclusion-----------------------------------------------------------------------------41
5.4 Suggestion for further research----------------------------------------------------42
Bibliography --------------------------------------------------------------------------43
Appendix A----------------------------------------------------------------------------45
Appendix B-----------------------------------------------------------------------48